The Five: Red Flags To Watch for in a Merger Proposal

Clint David was featured in The Dallas Morning News article “The Five:Red Flags To Watch for in a Merger Proposal.”Full text can be found in the March 14, 2015, issue, but a synopsis is below.

How do you know whether a merger is the right fit for your company? Clint David recently offered tips on identifying red flags in a buyout proposal.

Your motivation

As the company leader, have you searched your soul for the motivation to merge with another organization? You are in deep trouble if it’s a bailout/parachute to safety for leadership and not in the company’s best interest.

Their motivation

Have you explored what is motivating the other company to merge? Do they truly care about your people? Or are they just looking at profits per partner, establishing an outpost and carving you up later like a Thanksgiving turkey?

Consensus building

Have you spent enough time communicating to everyone in your organization why a merger is in the company’s best interest? Fear of change can implode your deal before it ever gets off the ground if you do not deliver a clear and concise vision of the future.

Delay

Deals that languish die.It is incumbent upon an organization’s leaders, if they want to get a deal done, to work efficiently and deliberately toward closing. The more time that passes, the more problems people find.

Culture

The compatibility of the two company cultures can make or break a merger. If you get a stomachache every time you think about trying to blend your company’s culture with the culture of the other company, pull the plug.